Papers Relating to the Foreign Relations of the United States, With the Annual Message of the President Transmitted to Congress December 8, 1908
Minister Russell to the Secretary of State.
Caracas, August 4, 1907.
Sir: In accordance with your instructions No 90, of June 21, 1907, received here July 7, I have the honor to state that on July 9 I addressed a note to the Venezuelan Government in regard to the five pending cases in which American citizens claim redress, a copy of which is herewith inclosed (inclosure No 1).
On July 24 I received an answer to my note, a copy of the Spanish text of which is herewith inclosed with translation (inclosures 2 and 3).
Although I considered this answer as unsatisfactory, yet there were some new statements in it that I thought the department might want to see, and I cabled to you on July 25, before making the formal proposition for arbitration at The Hague.
Touching the Crichfield case, the ministry for foreign affairs makes the statement that in an interview with the President I had agreed to “what was considered a satisfactory agreement.” This is a misstatement I had a conference with the President and the minister of fomento was present At this conference there was shown me a copy of a proposed new contract which the President had ordered to be forwarded to the United States & Venezuela Co., and which he (the President) said he thought was entirely satisfactory, as he had granted all and even more than the company asked I cabled this [Page 806] interview on March 6, 1906, requesting information for the President as to the attitude of the Crichfield people in regard to the proposed new contract, and on March 15 the department replied: “We have been informed by the Crichfield Co that Venezuelan proposition has not been accepted.”
The statement as to Mr. Jaurett being private secretary to Mr. Bowen may have arisen from the fact that during the “Libertadora” revolution Mr. Bowen gave Mr. Jaurett a “safe conduct” as his private secretary for the purpose of obtaining information from the interior as to the progress of the revolution With this “safe conduct” Mr. Jaurett accompanied me to Guanta and Barcelona on the U. S. cruiser Cincinnati.
I am, etc.,
Minister Russell to the Minister for Foreign Affairs.
Caracas, July 9, 1907.
Sir: Referring to my communication of March 30, 1907, in which, in accordance with instructions, I brought to the attention of the Venezuelan Government the five pending cases in which American citizens claim redress, and asked for a serious and immediate consideration of those cases as presented in a copy of instructions to me, which I inclosed with my note, I have to say that my Government regrets to find in the position assumed by Venezuela, in its memorandum in reply, a complete absence of anything responsive to its proposition looking to an amicable adjustment of these controversies by means of international arbitration.
The answer the Venezuelan Government makes practically refuses consideration and is practically confined to a simple denial of the correctness of the attitude of the Government of the United States.
With that patience, however, which has characterized the actions of my Government in the past in all of its relations to Venezuela, I am again instructed to reiterate the views expressed in the copy of the instructions which accompanied my note of March 30, above referred to, and to make reply as follows to each of the points raised by the memorandum of Venezuela:1
I am furthermore instructed to respectfully request your honor, in each and every one of the aforesaid cases, to favor me with a prompt reply, and I avail myself, etc.
The Minister for Foreign Affairs to Minister Russell.
Caracas, July 24, 1907.
Sir: I have the honor to acknowledge the receipt of your excellency’s official note of July 9 of the current year.
My Government is quite surprised to see the somewhat uncordial phrases made use of in the note to which I refer, in judging of and qualifying the proceedings and resolutions of the executive power in the cases which your excellency mentions, phrases which are overlooked in answering your excellency’s Government.
Upon a careful examination of the questions brought anew to the consideration of the Government of Venezuela, it will be found that the patience and discretion which the executive power has observed in said questions has been [Page 807] very considerable, a procedure adopted purposely, in view of the desire of maintaining on the firmest footing the friendly relations which it has striven to cultivate with the Government of the United States.
In the first place, Mr. Minister, the Government of Venezuela reiterates its position as stated in the memorandum which was addressed to you in answer to the one which you sent to this ministry on the 30th of March last, and proceeds now, in order to more clearly show the right and justice which it has, to make, point by point, various declarations which it deems pertinent.
The Government of Venezuela can not but think that the Government of the United States forgets the data and antecedents which should deter it from giving its protection to the so-called Mr. Jaurett, who, a fugitive from France, his native country, and from the tribunals of justice of Mexico, seeks now to shield himself under the folds of the American flag, to attack a country to which said Government has repeatedly given assurance of friendly sentiment.
The more surprising is it, taking into account that the above-mentioned Jaurett, on fleeing from Mexico in the year 1896 for the crime of a fraud, came immediately to Venezuela, knowing, without doubt, that there was no extradition treaty with the Mexican Republic, and without having previously complied with the requisites for maintaining an uninterrupted residence of five years in the United States, as prescribed by the laws then in force in that country, and without which he could not have acquired at that time a true American nationality.
It is also very strange that the Government of the United States does not take into consideration the conduct of Mr. Jaurett in Venezuela during the whole of the revolution called “Libertadora,” when, under salary from the New York & Bermudez Co., this latter being the agent and principal accomplice in said revolution, he availed himself of the cable to send news to the Associated Press and important newspapers of the United States, by way of Curaçao, thus causing to be circulated alarming and even calumniating news against the constituted Government.
Your excellency’s note makes a great point of the fact that the constitution of Venezuela limits the exercise of the sovereign right of expulsion from the territory of the Republic of pernicious foreigners, in the case where they have acquired domicile To this the Government of Venezuela answers that it never regarded Mr. Jaurett as domiciled in Venezuela, because, admitting the fact that he did reside in the country for several years, there is no proof that he made any declaration before the proper authorities of his wish to acquire domicile, as required by law, it being public and notorious that, notwithstanding the fact that he was married, he did not establish a home here with his wife, who lived all of that time out of Venezuela.
Lastly, Mr. Jaurett was considered for the greater part of his residence in Venezuela as an employee of the American legation, firstly, on account of his relations and business negotiations with Mr. Francis B. Loomis, envoy extraordinary and minister plenipotentiary of the United States up to the beginning of 1901; and afterwards for having been private secretary of Mr. Bowen up to 1904, when his services ceased, Mr. Bowen having acquired at that time from the French legation very unfavorable reports as to the character and antecedents of Mr. Jaurett In accordance with the provisions of the law of foreigners of the Republic of April 2, 1903, residence for the purpose of acquiring domicile is interrupted from the fact of being in the diplomatic service of another country (See above-mentioned law and pp. 37, 43, 69, 138, 194, 219, 222, 223, 224, and 229 of the pamphlet printed by the Government in Washington in 1905 and entitled “In the affair of the charges of Mr. H. W. Bowen, United States minister in Venezuela, against Mr. F. B. Loomis, First Assistant Secretary of State, and the countercharges of Mr. Loomis against Mr. Bowen.”)
As to the revision treated of in the second case in your excellency’s note relative to awards made by the umpire of the Venezuelan-American Mixed Commission, in the claims as presented by the agent of the Government of the United States, Mr. Robert C. Morris, in the name of “George Turnbull,” the “Manoa Co (Ltd.),” the “Orinoco Co (Ltd.),” and the “Orinoco Steamship Co.,” not only does the Government of Venezuela find no justifiable explanation for this pretension, but finds it strange and even surprising, as when the awards referred to were made, neither the aforesaid agent or representative of the Government of the United States before the Venezuelan-American Mixed Commission, nor even the Government of your excellency, made any protest at the time against those awards as rendered by the honorable Mr. Harry Barge, who as umpire selected by Her Majesty the Queen of the Netherlands, had the especial and exclusive duty of settling any question in regard to which there [Page 808] was a disagreement between the respective commissioners of Venezuela and the United States, as happened in the cases treated of.
Not only was there no protest made to the Venezuelan-American Mixed Commission when the respective awards were made on February 20 and April 12, 1904, nor within a natural time limit or the limit which the established practices of international law allow for formulating such protests, but the sums awarded by the umpire to the Orinoco Steamship Co of $28,224.93, and to the Orinoco Co (Ltd.) of $26,620, figure since that time as a part of the sum which the Government of Venezuela owes to the Government of the United States and to other nations, in fullfillment of the sentences of the mixed commissions assembled in Caracas in 1903, and for which purpose it has to distribute between these creditors, pro rata, 30 per cent of the proceeds of the customhouses of La Guaira and Puerto Cabello, after the payment to the preferred creditors, as decided by The Hague Tribunal.
Consequently, it is surprising that the Government of your excellency, three years after the awards have been made, should take the position that it takes to-day in regard to them, with absolutely no reason, justice, nor right on its side.
As to the fact that the Government of Venezuela protests against the awards of the umpire of the Venezuelan-Belgian Mixed Commission, in the case of the General Water Co of Caracas, and of the Venezuelan-Mexican Commission in the case of the claim of Messrs Martinez del Rio Hermanos, the Government of your excellency does not give the reasons which can be adduced to establish the parity of the cases, as the protest to the Government of Venezuela in these cases was made the same day that the award was given, as being against the express stipulations of the protocols which fixed the jurisdiction of the mixed commissions; and consequently the Government addressed itself immediately to the Belgian representative in an official note accompanied by the protest which the attorney general of the nation made before the commission; and furthermore immediately named a minister for Brussels with the principal object of explaining without loss of time the very just and powerful reasons on which Venezuela founded its right to ask for a revision of that sentence, and also that said reasons should be duly studied and considered by the Government of His Majesty the King, being as he is a friend of Venezuela.
In regard to the protest against the award in the claim of Messrs, Martinez del Rio Hermanos because the umpire had neglected to take into account the countercharges of the Government of Venezuela against that of Mexico, said countercharges having been submitted by mutual agreement for the examination and decision of the commissioners, the umpire refusing to receive said protest, alleging that the commission had finished its work, and there being no diplomatic representative of the Republic of Mexico in this city, the Government of Venezuela decided to instruct its special agent at The Hague Tribunal, then in session, to make known to the powders there represented the justifiable grounds for that protest against an award which was enormously prejudicial to the fiscal interests of the Republic, detrimental not only to those interests but to the interests of the other creditor nations The Venezuelan commissioner carried out his instructions, as may be seen by reference to the “proceso verbal” X of the session of the 10th of November, 1903; that is to say, one month and eight days after the rendering of the award in question.
From a perusal of your excellency’s note to which I refer, and to the memorandum of March 30 last, the pretension to revise the award in the claim of “The Manoa Co., (Ltd.)” is made now by your excellency’s Government, not in the name of the interested parties which figured as claimants against the Government of Venezuela, but in the name of a new party called the “Orinoco Corporation,” of which nothing was known at the time of the presentation of the claim and of its examination and settlement.
This so-called “Orinoco Corporation,” styling itself the transferee of ‘rights which were declared by the umpire as without foundation whatever in the claims presented by the “Manoa Co (Ltd.),” the “Orinoco Co (Ltd.),” and “George Turnbull,” and setting forth facts posterior to the awards in question, or in the year 1906, places itself in this novel position, viz, that with a change of name from the “Orinoco Co (Ltd),” to the “Orinoco Corporation,” questions of more than 20 years old are renewed, which questions were especially examined and passed upon by the umpire, the honorable Mr. Barge; thus alleging that acts committed after the rendering of said award, and as a consequence of it, destroy its validity and strength, so that that which is a consequence of the award serves to annul it, or the principal depends on the accessory, or the cause on the effect.
[Page 809]The verdict of the honorable Mr. Barge in the Manoa claim and other claims established the incontrovertible principle, and in this he is in accord with the Northfield decisions of the honorable Judge Plumley, umpire of the Venezuelan-French Mixed Commission, in a similar case, that juridical questions in regard to the rescission of contracts between individuals and governments are of the exclusive jurisdiction of the tribunals of the country whose government made the contract, and it was in accordance with this principle that both umpires declared as out of their jurisdiction the examination and decision of those points, referring them to the Venezuelan tribunals of justice If your excellency’s Government invokes, as it does, the force of the decision of the honorable Mr. Barge to claim that the Government of Venezuela could not execute certain acts posterior to that decision, without a previous decision by the federal and cassation court on the rescission of the Fitzgerald contract, of, which the “Manoa Co (Ltd.)” was transferred, it is thus using the validity and force of the question adjudicated by the umpire, and it is inconceivable that it asks at the same time for a revision of that verdict in favor of the “Orinoco Corporation.”
The observation of your excellency’s Government is so strong in qualifying the decision of the honorable Mr. Barge, when it says “that it rests on such serious errors of law and fact, and manifests such a complete disregard as well of the terms of the protocol as of those principles of justice and equity common not only to international law, but to the law of all civilized states,” that the Government of Venezuela is bound to reject, in the name of that same international law and of that respect which its principles merit, expressions of such a nature, in referring to one who has filled the high functions of umpire, chosen by Her Majesty Queen Wilhelmina, who, in appointing him, complied with the request of both Governments It can not be said of a sentence in a ease of this kind that it is manifestly unjust and at variance with the law of civilized states, when said sentence has been pronounced in a question about which the interested parties and the commissioners of the two Governments have failed to agree and for which reason it was agreed to submit it to the decision of an impartial umpire.
Much less justifiable is the statement of your excellency’s Government in regard to those awards when it is taken into consideration that the person who made those arrangements or protocols for the creation of the mixed commissions in question was Mr. Herbert W. Bowen, at that time United States minister in Caracas, and to the carrying out of those arrangements the Government of the Republic has devoted its attention and efforts, as your excellency knows, and as should be justly considered by those Governments to which the Republic religiously pays the sums awarded by the numerous decisions of the mixed commissions.
In the case of the New York & Bermudez Co it is quite strange that your excellency’s Government should ask Venezuela to take away from the courts of the Republic the suits instituted against the New York & Bermudez Co., and even suits in course of trial, to make out of this as it were an accumulation or increase of claims against Venezuela by means of an action entirely diplomatic, when the Government of the Republic is sure that neither the Government of the United States nor that of any other independent and sovereign nation would stand for such proceeding.
Your excellency’s Government overlooks the fact universally known through the North American press, and proven in the suit in course of trial in the civil branch of the court of first instance of this section of the Federal district, of the active part which the New York & Bermudez Co took in the revolution called “Libertadora” against the Government of Venezuela, a complicity which for itself alone would have been sufficient reason for any other Government less patient and less respectful of the usual judicial procedure to have taken immediate steps of a rigorous nature in accord with justice and perfect right; and the executive is so empowered in the case of an armed rebellion against the constituted authorities, and can suspend for this purpose all rights and guarantees, the enjoyment of which are incompatible with the measure of defense for reestablishing order.
The Attorney General having instituted suits against the New York & Bermudez Co., in the respective tribunals, for act affecting its responsibility, first as transferee of the Hamilton contract, for nonfulfillment of its obligations, and again as an accomplice in the aforementioned “Libertadora” revolution, the proceedings in both suits have been in entire conformity to the laws of the country, and in order to invoke denial of justice it would be absolutely necessary [Page 810] to present proofs of such denial of justice Can your excellency’s Government, without irrefutable proofs, defend said company, and take the aggressive attitude that it does in qualifying the suits against the New York & Bermudez Co as arbitrary and in gross violation of Venezuelan law? Can it forget that the party thus defended has committed the crime of insurrection against the Government of Venezuela, and that in violating, as it has violated, the laws of neutrality in a country friendly to the Government of your excellency, it has incurred grave responsibilities for which the very laws of the United States inflict severe punishment on its nationals?
The Government of Venezuela does not suppose that your excellency’s Government would care to be held in any manner responsible for the revolutionary acts of the New York & Bermudez Co., and for the immense damage caused the Republic by said acts Consequently the judicial action of the representative of the nation has been directed exclusively against the New York & Bermudez Co., and not against your excellency’s Government, the precautionary attachment of the asphalt mine being continued to await the result of the suits.
Consequently the properties of the New York & Bermudez Co have not been attacked by the Government of Venezuela, but the company itself, by its own acts, has made it necessary for the Government of the Republic to bring it to trial These proceedings have been carried on and are still being carried on before the proper tribunals, with every means for defense and all the guarantees under the laws, without any proven denial of justice as alleged; and consequently to this case there could not have been, nor can there be applied now, any diplomatic procedure.
Lastly, I have to say to your excellency that the claim of the United States & Venezuela Co is much similar to that of the New York & Bermudez Co as regards the question of rescission of contract, which your excellency states that said company has elected to do, alleging as a reason therefor certain acts of the Government of Venezuela There does exist, however, a cardinal difference in the proceeding adopted by one and the other party in both negotiations, as the Government of Venezuela, through the representative of the nation, has submitted to the proper tribunal the questions arising out of the contract of which the New York & Bermudez Co was transferee, but your excellency’s Government attempts to take away the question of rescission of the Crichfield contract, and the question of consequent damages and losses, from the jurisdiction of the tribunals of justice of Venezuela, thus overlooking the laws of the Republic, the only ones applicable in matters of contracts, when the latter are celebrated and must be executed in its own territory To attempt to substitute the proper legal action of the contracting parties in regard to rescission with diplomatic action is in manifest violation of universally established principles and laws, impairs the dominion and jurisdiction of the tribunals of the Republic, and at the beginning breaks one of the express provisions of said contract, which is textually as follows: “The doubts and controversies which may arise as to the interpretation and execution of this contract shall be resolved by the tribunals of the Republic, in conformity to its laws, and in no case can be a motive for international claims.”
Your excellency’s Government falls into a flagrant contradiction when it invokes decisions of the federal court of Venezuela and even of international tribunals, which have declared that contracts celebrated by the Federal executive can not be destroyed by a decree of said executive and that the cancellation of a concession so granted is a question for judicial and not political action, and when, as in the case of the Crichfield concession, it asks the Government of Venezuela to agree to the rescission of that contract on account of what the interested company chooses to do, thus doing away with all judicial proceedings Such a repudiation and rescission of the contract laid down in your excellency’s note as adopted by the “United States & Venezuela Co.,” alleging that no satisfactory arrangement has been reached with the Government of Venezuela, if assented to by the Federal executive, disregarding judicial discussion in the competent tribunals, for settling upon damages and losses before an international tribunal, would be to go against the constituted faculties of the judicial power, which, as your excellency knows, is the third power in the Republic, whose prerogatives and jurisdiction can not be interfered with by the executive power.
Surely it was in view of this that your excellency and the representative of the United States & Venezuela Co treated directly with the President of the Republic, and agreed to what was considered a satisfactory arrangement, but which remained in suspense by order of the Government of the United States, according to private statements made at that time.
[Page 811]Surely since that time began the attitude which is to-day taken against a Government which has always relied upon the greatest friendship on the part of your excellency’s Government amongst those that favor it with their good and very cordial relation.
Consequently the Government of Venezuela hopes that in view of these antecedents and of the very good disposition which your excellency knows, and which is constantly shown, you will please explain to your Government those circumstances which can serve for the interests of both countries and for their good relations of friendship, this being the most appreciable result of the mission confided to those who are invested with a diplomatic character near a Government who really strives to cultivate with friendly nations the most cordial relations, cementing them always on the broad and sure basis of equity, justice, and right.
I take this opportunity to renew to your excellency the protests of my highest consideration.
I am, etc.,